The Political Economy of Efficient Public Good Provision: Evidence from Flemish Libraries Using a Generalised Conditional Efficiency Framework

24 Pages Posted: 5 Jun 2009

See all articles by K. De Witte

K. De Witte

University of Leuven (KUL); Maastricht University

Benny Geys

Vrije Universiteit Brussel (VUB)

Date Written: June 3, 2009

Abstract

Provision of most public goods (e.g., health care, library services, education, utilities) can be characterised by a two-stage ‘production’ process. The first stage translates basic inputs (e.g., labour and capital) into service potential (e.g., opening hours), while the second stage describes how these programmatic inputs are transformed into observed outputs (e.g., school outcomes, library circulation). While the latter stage is best analysed in a supply-demand framework, particularly in the former stage one would like to have efficient public production. Hence, unlike previous work on public sector efficiency (which often conflates both ‘production’ stages), this paper analyses how political economy factors shape efficient public good provision in stage one (using local public libraries as our centre of attention). To do so, we use a specially tailored, fully non-parametric efficiency model. The model is rooted in popular Data Envelopment Analysis models, but allows for both outlying observations and heterogeneity (i.e., a conditional efficiency model). Using an exceptionally rich dataset comprising all 290 Flemish public libraries, our findings suggest that the ideological stance of the local government, the wealth and density of the local population and the source of library funding (i.e., local funding versus intergovernmental transfers) are crucial determinants of library efficiency.

Keywords: nonparametric estimation, conditional efficiency, political economy, public good provision, libraries

JEL Classification: C14, C61, I21

Suggested Citation

De Witte, Kristof and Geys, Benny, The Political Economy of Efficient Public Good Provision: Evidence from Flemish Libraries Using a Generalised Conditional Efficiency Framework (June 3, 2009). Available at SSRN: https://ssrn.com/abstract=1414228 or http://dx.doi.org/10.2139/ssrn.1414228

Kristof De Witte (Contact Author)

University of Leuven (KUL) ( email )

Naamsestraat 69
Leuven, Vlaams Brabant B-3000
Belgium

HOME PAGE: http://www.feb.kuleuven.be

Maastricht University ( email )

Boschstraat 24
Maastricht, Vlaams-Brabant 6211 AX
Netherlands
003216326656 (Phone)

HOME PAGE: http://www.feb.kuleuven.be

Benny Geys

Vrije Universiteit Brussel (VUB) ( email )

Pleinlaan 2
http://www.vub.ac.be/
Brussels, 1050
Belgium

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